Japan’s Mitsubishi UFJ to buy two Asia units of Home Credit for $620 mln

TOKYO, Nov 24 (Reuters) – Japan’s Mitsubishi UFJ Financial Group Inc (8306.T) said on Thursday it would buy the Philippines and Indonesian units of Dutch consumer finance company Home Credit BV (HC) for about 596 million euros ($621 million).

The deal comes as Japan’s largest lender aims to beef up its business in Asia to tap growth in consumption in emerging markets, while ultra-low interest rates and an aging population limit business opportunities at home.

HC’s main services include point-of-sales loans, offered to customers for their purchases of goods and services at the point of sale both physical and online.

The acquisitions will be made through main Mitsubishi UFJ banking arm MUFG Bank, Thai unit Bank of Ayudhya PCL (BAY) (BAY.BK), and Indonesian unit Adira Dinamika Multi Finance (ADMF), with the deal to be completed within 2023, the company said.

HC is controlled by the Czech Republic’s biggest investment group, PPF, which was founded by late billionaire Petr Kellner. It reported a wider loss in the first half of 2022, mainly due to the impact from the sale of Russian operations.

PPF, which had been looking at selling or taking on partners in some markets for the HC business, said in a statement it was the right time to pass the baton.

Mitsubishi UFJ, which owns about 22% of Morgan Stanley (MS.N), is completing its $8 billion sale of MUFG Union Bank (MUB) (UBCAL.UL) to U.S. Bancorp as part of its global business reshuffle.

A Mitsubishi UFJ executive said in a briefing that the lender would explore further acquisition opportunities in Southeast Asia.

Among Japanese banks, Sumitomo Mitsui Financial Group Inc (8316.T) said this month it would buy an additional 15% stake in the Philippines’ Rizal Commercial Banking Corp (RCBC) (RCB.PS) for about $460 million. read more

After the completion of the deal, Bank of Ayudhya will hold 75% of the shares of HC Philippines and 75% of the shares of HC Indonesia. MUFG Bank will hold 25% of HC Philippines, and ADMF will hold 10% of HC Indonesia shares.

($1 = 0.9598 euros)

Reporting by Makiko Yamazaki in Tokyo; Additional reporting by Jason Hovet in Prague; Editing by Tomasz Janowski and Bradley Perrett

Our Standards: The Thomson Reuters Trust Principles.

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